WEBVTT - Chris Hughes on How to Craft a Thriving Market 0:00:02.480 --> 0:00:08.680 Bloomberg Audio Studios, Podcasts, radio News. 0:00:18.239 --> 0:00:22.000 Hello and welcome to another episode of the Odd Lots Podcast. 0:00:22.079 --> 0:00:24.439 I'm Joe Wisenthal and I'm Tracy Alloway. 0:00:24.640 --> 0:00:28.600 Tracy, we recently did another special live episode at the 0:00:28.600 --> 0:00:29.600 New York Public Library. 0:00:29.800 --> 0:00:33.279 Yeah, a really great venue, a really special evening, and 0:00:33.360 --> 0:00:37.000 fittingly given that we were recording at a library, the 0:00:37.240 --> 0:00:39.960 library in New York, it was all about a new. 0:00:39.800 --> 0:00:41.200 Book, that's right. 0:00:41.240 --> 0:00:43.920 It was a pretty fitting location. So you were going 0:00:43.920 --> 0:00:47.200 to listen to our live episode that we recorded with 0:00:47.400 --> 0:00:51.120 Chris Hughes. He's actually one of the original founders of Facebook, 0:00:51.120 --> 0:00:54.680 but he left fairly early into the company's journey. He's 0:00:54.720 --> 0:00:58.200 currently getting his PhD at Penn in economics and he's 0:00:58.240 --> 0:01:00.680 the author of the book Market Crafters, One hundred Year 0:01:00.720 --> 0:01:02.520 Struggle to Shape the American Economy. 0:01:02.640 --> 0:01:03.760 Yep, take a listen. 0:01:04.319 --> 0:01:07.920 Thrilled to be a chatting why market craft? You know, 0:01:08.000 --> 0:01:10.600 we talk people use the term industrial policy a lot 0:01:10.640 --> 0:01:13.240 these days. It's got very hot over the last several years. 0:01:13.560 --> 0:01:16.120 What is market craft mean? Why title it that? 0:01:16.840 --> 0:01:17.000 Well? 0:01:17.040 --> 0:01:20.560 Hello, Hello, I'm happy to be here. And before I 0:01:20.600 --> 0:01:23.120 answer exactly what market craft is? And we spend the 0:01:23.160 --> 0:01:24.920 next hour talking about it. I just have to say 0:01:25.400 --> 0:01:28.160 that it is such a huge honor to be both 0:01:28.360 --> 0:01:31.119 here at the library and institution that I care immensely about, 0:01:31.240 --> 0:01:36.360 and to be a guest on this live tapings. 0:01:35.280 --> 0:01:38.920 Than is my number one favorite podcast, and so we. 0:01:38.920 --> 0:01:40.520 Love when they say that on the recording. But that 0:01:40.680 --> 0:01:43.759 is a good reminder. It is a live taping, so you. 0:01:43.760 --> 0:01:45.760 Know, silence cell phones, you can you can share it. 0:01:45.760 --> 0:01:46.520 Clap a little bit. 0:01:46.920 --> 0:01:51.200 So market craft, what is it? The basic idea is 0:01:51.520 --> 0:01:57.160 that policy makers are often harnessing and shaping, harnessing private 0:01:57.240 --> 0:02:02.640 markets and pointing them towards public goals like making Americans richer, safer, 0:02:02.720 --> 0:02:06.800 and more economically secure, and that there's actually a very 0:02:06.840 --> 0:02:09.480 long history of doing that in the United States. It's 0:02:09.520 --> 0:02:14.080 done by Republicans, it's done by Democrats. It's done to 0:02:14.360 --> 0:02:19.720 ensure energy stability, financial stability, or make semiconductors here at home. 0:02:20.240 --> 0:02:24.080 There are a ton of successes in the past, plenty 0:02:24.120 --> 0:02:26.160 of failures, and the whole point of writing the book 0:02:26.280 --> 0:02:30.880 was to try to tease out what are the lessons 0:02:30.919 --> 0:02:34.040 for our contemporary policy environment today, because we're going to 0:02:35.160 --> 0:02:37.079 have to rebuild on the other side of the chaos 0:02:37.160 --> 0:02:39.160 that exists in the world right now. 0:02:39.680 --> 0:02:42.440 So just on this point, I mean, a large part 0:02:42.440 --> 0:02:45.119 of the book is pointing out that the US does 0:02:45.160 --> 0:02:48.880 in fact have this history of market craft as you 0:02:48.880 --> 0:02:51.360 put it, and certainly other countries this is kind of 0:02:51.680 --> 0:02:55.079 the norm. You know, Norway has sovereign wealth funds, parts 0:02:55.080 --> 0:02:57.440 of the Middle East have sovereign wealth funds. Even in 0:02:57.560 --> 0:03:01.600 economies that aren't necessarily centrally controlled, there's a bigger role 0:03:01.720 --> 0:03:04.880 for governments to play in the economy. And yet in 0:03:04.919 --> 0:03:07.919 the US up until fairly recently, I think it's fair 0:03:07.919 --> 0:03:10.840 to say industrial policy was almost like a dirty word, 0:03:10.960 --> 0:03:14.440 and there's this knee jerk reaction to this idea. 0:03:14.520 --> 0:03:15.120 Why is that? 0:03:15.360 --> 0:03:19.560 Yeah, I mean I think, listen, we all exist with 0:03:19.639 --> 0:03:24.720 this idea in our heads that markets exist and are 0:03:24.880 --> 0:03:27.679 almost forces of nature, and then on the other side 0:03:27.680 --> 0:03:30.680 of the balance sheet there's government. I mean, I'm the 0:03:30.680 --> 0:03:33.400 first to say that the language that I've used for 0:03:33.520 --> 0:03:39.640 years has been around verbs like to intervene, as if 0:03:39.680 --> 0:03:42.160 markets come first, and then government is just like the 0:03:42.200 --> 0:03:45.720 emergency room that happens when things go awry and you've 0:03:45.720 --> 0:03:48.240 got to bail out a bank. And the whole point 0:03:48.280 --> 0:03:51.720 of My book is to say, actually, something bigger is happening. 0:03:52.000 --> 0:04:00.960 Like if you look at the American economy between healthcare, pharmaceuticals, aviation, semiconductor, 0:04:00.960 --> 0:04:04.600 and high tech clean energy, and add up the size 0:04:04.600 --> 0:04:07.640 of these industries, you are well over half of American 0:04:07.680 --> 0:04:10.600 GDP in industries where the state not just has a 0:04:10.640 --> 0:04:15.000 heavy hand, but is actually crafting it from the beginning. 0:04:15.080 --> 0:04:17.800 And so it is about industrial policy. There's a lot 0:04:17.839 --> 0:04:21.120 in there about industrial policy, but it's actually about something bigger. 0:04:21.200 --> 0:04:24.239 Market craft is something that encompasses what the FED does 0:04:24.400 --> 0:04:28.920 in financial markets, what the Strategic Petroleum Reserve does in 0:04:29.160 --> 0:04:31.720 energy markets. There's a whole set of strategies that I 0:04:31.760 --> 0:04:34.040 think we have to be wrestling with. 0:04:34.160 --> 0:04:35.760 All Right, I had a question that I was going 0:04:35.800 --> 0:04:38.880 to save to near the end after we had gotten 0:04:38.880 --> 0:04:40.080 more relaxed, et cetera. 0:04:40.400 --> 0:04:43.200 But I've decided just do it. I've just decided that 0:04:43.240 --> 0:04:43.640 I'm just. 0:04:43.560 --> 0:04:46.160 Going to jump in with this question, which is you're 0:04:46.240 --> 0:04:48.039 one of the co founders of Facebook. 0:04:48.560 --> 0:04:49.920 Many people in. 0:04:49.839 --> 0:04:54.720 Silicon Valley and tech have enjoyed extraordinary fortunes under a 0:04:54.760 --> 0:04:59.880 sort of existing market economic regime, and in recent years 0:05:00.000 --> 0:05:03.800 we've seen a number of them become seemingly very hostile 0:05:04.320 --> 0:05:08.479 towards the public sector, the sort of emergent anti state politics, 0:05:08.640 --> 0:05:10.560 and people have different theories. So people are like, oh, 0:05:10.560 --> 0:05:12.320 they got their feelings hurt from the New York Times 0:05:12.480 --> 0:05:14.719 or something like that. What is your theory for the 0:05:14.720 --> 0:05:15.440 emergence of this? 0:05:16.640 --> 0:05:18.880 Well, I mean it's hard not to have that image 0:05:18.960 --> 0:05:22.880 of Bezos and Zuckerberg and the whole crew behind Trump 0:05:23.040 --> 0:05:26.560 at the inauguration and just see that and say, what 0:05:26.600 --> 0:05:30.760 are those guys hoping for? You know, certainly it's to 0:05:30.880 --> 0:05:34.880 make more money somewhat, but I think it's about something bigger. 0:05:34.960 --> 0:05:37.920 I think they want to have more power, they want 0:05:37.920 --> 0:05:39.839 to have more respect, and they feel like in the 0:05:39.839 --> 0:05:43.200 Biden years there was too much focus on things like 0:05:43.880 --> 0:05:47.200 competition and fair markets. But if you fast forward, I 0:05:47.240 --> 0:05:49.360 mean it's not even been one hundred days. You know, 0:05:49.560 --> 0:05:53.479 the trial against Facebook is ongoing. Mark Zuckerberg was on 0:05:53.520 --> 0:05:55.760 the stand for much of last week. If you're not 0:05:55.800 --> 0:05:59.520 following it closely, the FTC filed suit against Uber two 0:05:59.600 --> 0:06:04.240 days ago, and there's and Google just last week lost 0:06:04.320 --> 0:06:08.160 its second antitrust case with a federal prosecuted by the 0:06:08.240 --> 0:06:13.279 Justice Department, making clear that it's a monopoly. So we're 0:06:13.760 --> 0:06:15.599 only a few months in and you squint and you 0:06:15.640 --> 0:06:18.480 look at you're like, what are these guys getting out 0:06:18.480 --> 0:06:21.479 of this? It doesn't seem like very much since you 0:06:21.520 --> 0:06:22.440 brought up the FTC. 0:06:22.720 --> 0:06:24.320 I mean, this is something I don't think a lot 0:06:24.360 --> 0:06:28.640 of people were expecting this to happen. But like, anti 0:06:28.720 --> 0:06:32.600 monopoly seems to be a through line between Biden and 0:06:32.680 --> 0:06:38.440 Trump to some extent, right and certainly pursuing some actions 0:06:38.520 --> 0:06:41.440 against big tech. Why do you think that is? Like 0:06:41.480 --> 0:06:43.800 why is this an area of consensus? And then just 0:06:43.839 --> 0:06:46.560 going back to Joe's question, you think any of those 0:06:46.600 --> 0:06:49.960 guys who were standing at Trump's inauguration are they happy 0:06:50.080 --> 0:06:51.160 with the current situation? 0:06:51.440 --> 0:06:52.000 I don't think so. 0:06:52.480 --> 0:06:56.160 No, But you know, anti monopoly is a bit how 0:06:56.200 --> 0:06:58.479 I got into market craft in the first place. So 0:06:59.320 --> 0:07:02.479 about six years ago I wrote an article in New 0:07:02.560 --> 0:07:05.799 York Times saying that I thought Facebook should undergo structural 0:07:05.839 --> 0:07:09.560 separation or breakup, that its corporate power had become too 0:07:09.600 --> 0:07:12.800 concentrated and it become a monopoly. And that started me 0:07:12.840 --> 0:07:16.160 on a journey of really wrestling with the history of 0:07:16.160 --> 0:07:20.360 anti monopoly in the United States. And you can't think 0:07:20.400 --> 0:07:26.240 about that set of topics without seeing public actors saying, hey, 0:07:26.240 --> 0:07:29.160 we want markets to work a certain way. We don't 0:07:29.200 --> 0:07:31.480 think that they should be concentrated with a lot of power. 0:07:31.520 --> 0:07:33.920 We think they should be competitive. We think it should 0:07:33.920 --> 0:07:36.400 be easy for new entrants to come in and innovate. 0:07:36.720 --> 0:07:40.840 We think markets should keep prices low, wages up, and 0:07:41.520 --> 0:07:43.600 innovation going. And so we are going to use the 0:07:43.640 --> 0:07:47.600 tools of public policy to craft those markets to ensure 0:07:48.120 --> 0:07:50.680 that's the case. Whether it's the free market going to 0:07:50.720 --> 0:07:52.520 lead to it or not, it really doesn't matter, because 0:07:52.560 --> 0:07:55.200 we have this goal as a common good. And so 0:07:55.320 --> 0:07:57.720 once you sort of once I began to see that 0:07:57.840 --> 0:08:02.880 in the anti monopoly world, you quickly saw it at 0:08:03.080 --> 0:08:07.080 the FED as an institution that you know, most free 0:08:07.120 --> 0:08:11.960 market Bible thumping folks would say that they appreciate, but 0:08:12.160 --> 0:08:15.440 you know, the FED sets the price of short term 0:08:15.480 --> 0:08:21.920 credit and is actively in markets buffering that price through 0:08:21.960 --> 0:08:24.640 open market operations. And then if things really go awry, 0:08:24.880 --> 0:08:27.040 you bet it's going to be there to step in 0:08:27.240 --> 0:08:32.120 to stabilize, so that market is crafted and managed every 0:08:32.360 --> 0:08:35.880 single day for stability. And so I began to see 0:08:35.880 --> 0:08:39.200 all these kind of cross pollinations and similar trends and 0:08:39.240 --> 0:08:41.600 that you know, a couple of years later, here's the 0:08:41.600 --> 0:08:42.040 fruit of that. 0:08:59.440 --> 0:09:01.280 I have one. I want to go back to resentful 0:09:01.400 --> 0:09:04.240 billionaires again and do it, and I have a different 0:09:04.320 --> 0:09:06.440 You're not the only worry. But tell me if it's 0:09:06.480 --> 0:09:07.160 total nonsense. 0:09:07.200 --> 0:09:09.360 You know, I tweet all day because I want people 0:09:09.360 --> 0:09:12.160 to hear all my thoughts. And you wrote a book, 0:09:12.320 --> 0:09:16.080 you left Facebook, and you're an economist and you're published 0:09:16.080 --> 0:09:19.160 a book that's influential and intellectual. How much is it 0:09:19.200 --> 0:09:22.959 about resent that they're extremely wealthy and successful, but they 0:09:23.040 --> 0:09:25.720 also want to be regarded as smart. 0:09:27.360 --> 0:09:30.600 This, in my opinion, is why Twitter exists, Like this. 0:09:30.679 --> 0:09:33.840 Is my impression, so that there is that they also 0:09:33.880 --> 0:09:35.120 want to be market crafters. 0:09:35.280 --> 0:09:35.920 They don't just. 0:09:35.960 --> 0:09:40.160 Want to be market competitors. They want to My sense 0:09:40.160 --> 0:09:42.440 is that we all want to be market crafters. And 0:09:42.480 --> 0:09:45.760 how much is it about they felt like, yeah, incredibly successful, 0:09:45.880 --> 0:09:47.200 but they didn't get to help craft it. 0:09:47.440 --> 0:09:50.200 Yeah, I think that's I think that's directly right. 0:09:50.240 --> 0:09:53.880 I should say I try very hard to avoid social 0:09:53.920 --> 0:09:56.560 media so that you're not on the blue app. I'm 0:09:56.559 --> 0:09:59.720 not on Instagram, I lark on Twitter. I recently opened 0:09:59.720 --> 0:10:01.920 a blue Sky account. It doesn't have a lot of followers, 0:10:02.120 --> 0:10:04.560 be great if I had a couple more, But so 0:10:04.720 --> 0:10:07.640 I'm not actively using social media, so it's harder for 0:10:07.679 --> 0:10:09.000 me to weigh in on that. 0:10:09.080 --> 0:10:09.880 But I am. 0:10:10.280 --> 0:10:13.960 I do think that there is this lurking desire to 0:10:14.400 --> 0:10:17.080 partner with government in some cases in craft markets. And 0:10:17.120 --> 0:10:19.240 so there's a very crisp example. It's not from one 0:10:19.280 --> 0:10:22.439 of the current billionaires. But there's this guy, Robert Nois, 0:10:22.600 --> 0:10:25.040 which some of you may have heard of. He was 0:10:25.040 --> 0:10:28.440 one of the co founders of Intel. Grew up as 0:10:28.520 --> 0:10:32.960 a son of a Congregationalist minister and a family in Iowa, 0:10:34.000 --> 0:10:38.520 ends up going to MIT and then invents the integrated circuit, 0:10:38.920 --> 0:10:44.360 which is a fundamental part of the semiconductor makes gobs 0:10:44.440 --> 0:10:49.240 of money, and after years of that, guess what happens 0:10:49.240 --> 0:10:53.800 in the mid nineteen eighties Japan. Japan as an industry 0:10:54.040 --> 0:10:59.760 starts really out competing the American semi conductor manufacturing market. 0:11:00.000 --> 0:11:03.760 They are moving faster, they have their own industrial policy 0:11:03.760 --> 0:11:05.520 that's pushing it. And so all of a sudden, Noise, 0:11:05.559 --> 0:11:08.719 who had for his entire life been a libertarian who 0:11:08.720 --> 0:11:11.160 didn't want anything to do with government, thought it was 0:11:11.440 --> 0:11:13.680 not a great idea, would have liked to downsize it 0:11:13.720 --> 0:11:17.880 as we're seeing other billionaires be interested in today, all 0:11:17.960 --> 0:11:20.480 of a sudden he shows up in Washington and he says, 0:11:20.480 --> 0:11:25.720 wait a second, we need an industrial policy for semiconductors 0:11:25.760 --> 0:11:29.920 and for chips. And the Defense Department agrees because they're 0:11:29.920 --> 0:11:33.840 concerned for national security reasons and noise, and the government 0:11:33.920 --> 0:11:38.559 effectively partner because their interests at that moment are overlapping. 0:11:38.920 --> 0:11:41.880 We get something called semitech which is created, which is 0:11:42.800 --> 0:11:47.280 about a billion dollars. It's invested to enable the semiconductor 0:11:47.320 --> 0:11:51.840 companies to begin coordinating, making their vertical their supply chains 0:11:52.000 --> 0:11:56.160 vertically more integrated and more efficient, and a few years later, 0:11:56.559 --> 0:12:02.560 America recaptures its market share and globally of semiconductors, we're 0:12:02.640 --> 0:12:05.840 back on the top. So, you know, I think that 0:12:06.040 --> 0:12:10.000 the lesson from that is complicated because on the one hand, 0:12:10.280 --> 0:12:14.360 you do see a private sector actor with a lot 0:12:14.400 --> 0:12:18.240 to gain from private private wealth maximization, but working with 0:12:18.400 --> 0:12:21.240 the public sector, where the public sector also has a 0:12:21.280 --> 0:12:25.000 lot to gain from semiconductors being made in the United States, 0:12:25.120 --> 0:12:28.199 and in that case it worked for both. It doesn't 0:12:28.200 --> 0:12:31.360 always work out like that. But I think that's clear 0:12:31.480 --> 0:12:34.080 historical evidence of the fact that there is this lurking 0:12:34.720 --> 0:12:37.040 desire for market craft on the part of a lot 0:12:37.080 --> 0:12:37.760 of these folks. 0:12:38.040 --> 0:12:40.760 Now I'm torn whether I should ask another question about 0:12:40.760 --> 0:12:43.880 angry billionaires who tweet a lot, or about the books. 0:12:43.920 --> 0:12:46.600 So I'm going to try to thread the needle elon 0:12:46.720 --> 0:12:51.920 musk at Doje. It's a very active organization. Some would say, 0:12:51.960 --> 0:12:55.520 would that count as market craft under your framework? 0:12:55.640 --> 0:12:58.679 No? No, no, But I mean seriously, it's. 0:13:00.080 --> 0:13:04.400 That's just tearing apart the federal government and the administrative Yeah, because. 0:13:04.200 --> 0:13:07.200 Your book is actually emphasizes the importance of institutions. 0:13:07.240 --> 0:13:09.920 It's the exact inverse. So my book makes the case 0:13:09.960 --> 0:13:14.199 that when market craft is successful, you have administrative agencies 0:13:14.640 --> 0:13:18.120 like the Chips Office, like the FED, like this SPR 0:13:18.679 --> 0:13:22.600 that have a clear mission on chore semiconductors, keep financial 0:13:22.600 --> 0:13:23.760 markets stable, et cetera. 0:13:24.440 --> 0:13:27.040 And then they have the discretion to pursue. 0:13:26.559 --> 0:13:30.760 That mission and the ability to get it done. And 0:13:30.800 --> 0:13:35.120 that it is critical to understand that institutions in America 0:13:35.840 --> 0:13:40.559 need that power in order to make markets work more effectively. 0:13:40.600 --> 0:13:43.760 That doesn't mean that they're always perfect, but we get 0:13:43.960 --> 0:13:48.280 much worse outcomes when we create these balkanized sort of 0:13:48.480 --> 0:13:51.120 hybrid setups, and that's what you see in something like 0:13:51.240 --> 0:13:55.560 healthcare markets today. So the importance of institutions is at 0:13:55.600 --> 0:13:59.560 the center of this book, and my belief in Musk 0:13:59.600 --> 0:14:01.880 and Crewer just trying to demolish all of them. 0:14:02.160 --> 0:14:06.160 So on the institution's point, I mean, I think part 0:14:06.480 --> 0:14:10.319 of the institution's problem in US politics is that you 0:14:10.640 --> 0:14:12.480 get a lot of people who think that these are 0:14:12.600 --> 0:14:15.680 unelected officials with a lot of power, you know, those 0:14:15.679 --> 0:14:18.920 sort of like Ivory Tower bureaucrats who are deciding everything. 0:14:19.800 --> 0:14:22.520 How do you, I guess, how do you overcome that 0:14:22.920 --> 0:14:28.000 sort of instinctual I guess negativity towards building more institutions 0:14:28.080 --> 0:14:29.000 in the US government? 0:14:29.640 --> 0:14:32.760 I think you show people where it works, and you 0:14:32.840 --> 0:14:37.440 have to be clear about where institutions actually deliver for people. 0:14:38.000 --> 0:14:39.960 So I'll give you an example that's a little bit 0:14:40.000 --> 0:14:43.040 further back in history. So the book starts with the 0:14:43.080 --> 0:14:46.440 story of the National Investment Bank that we create in 0:14:46.480 --> 0:14:50.960 the depression. In nineteen thirty two, Herbert Hoover, actually a Republican, 0:14:51.440 --> 0:14:56.360 creates an institution called the Reconstruction Finance Corporation, with a 0:14:56.400 --> 0:15:01.720 clear mandate, first to reinforce capitalism that was disintegrating at 0:15:01.720 --> 0:15:05.040 the time, and then a few years later the mandate 0:15:05.080 --> 0:15:09.600 expands to actually spur development. At the head of this 0:15:09.640 --> 0:15:12.640 thing is this larger than life figure named Jesse Jones. 0:15:13.040 --> 0:15:15.760 So this guy was born in Tennessee, but he moves 0:15:15.880 --> 0:15:20.040 to Texas at a young age. He invests in all 0:15:20.160 --> 0:15:22.400 kinds of local businesses, and by the time he's thirty, 0:15:22.400 --> 0:15:24.960 he's a millionaire. And a few years later he's got 0:15:24.960 --> 0:15:27.120 so much money that he's building buildings in New York 0:15:27.120 --> 0:15:31.280 City and all across the Eastern seaboard. Then nineteen twenty 0:15:31.320 --> 0:15:36.200 nine happens, and he has less to do, so he does. 0:15:36.280 --> 0:15:39.480 He is a Democratic Party activist. He's been a fundraiser 0:15:39.520 --> 0:15:42.200 for a long time, even shares an office with Roosevelt 0:15:42.240 --> 0:15:44.960 in nineteen twenty four. He convinces the Democrats to have 0:15:45.000 --> 0:15:48.240 their convention in Houston in nineteen twenty eight, where oh 0:15:48.280 --> 0:15:51.240 so conveniently, balloons fall from the ceiling that say Jesse 0:15:51.360 --> 0:15:52.240 Jones for President. 0:15:53.240 --> 0:15:54.360 He's like a larger than. 0:15:54.280 --> 0:15:56.280 Life figure, but he's at the head of this bank, 0:15:56.360 --> 0:16:00.880 this institution, the National Investment Bank, And when he comes 0:16:00.880 --> 0:16:03.840 into power. At the beginning, he says, you know, our 0:16:03.840 --> 0:16:06.520 first mission is going to be to reinforce all of 0:16:06.560 --> 0:16:09.320 the private commercial banks, recapitalize them, make sure that they're 0:16:09.360 --> 0:16:12.640 ready for deposit insurance. But then in the second phase, 0:16:13.600 --> 0:16:15.600 on the advice of John Maynard Kaines and some other 0:16:15.640 --> 0:16:19.160 economists Jones and consultation with Roosevelt, says, we got to 0:16:19.680 --> 0:16:24.600 really deploy public capital into the American economy, particularly in 0:16:24.720 --> 0:16:28.440 industries that are going to encourage a lot of employment 0:16:29.080 --> 0:16:33.680 and make things cheaper for consumers. So they prioritize housing, 0:16:34.480 --> 0:16:37.000 and they build a kind of institution that's named Fanny 0:16:37.040 --> 0:16:41.040 May which endures obviously today, and they invent the thirty 0:16:41.120 --> 0:16:44.560 year mortgage, which at the time mortgages had been ten years. 0:16:44.600 --> 0:16:47.400 By expanding it to thirty years, the cost of housing 0:16:47.720 --> 0:16:50.280 comes down significantly, and all of a sudden you see 0:16:50.280 --> 0:16:52.400 a boom in housing. And then there's a third phase 0:16:52.440 --> 0:16:55.000 in the war years where they bird the aviation industry 0:16:55.040 --> 0:16:57.520 and synthetic rubber and all kinds of other things. And 0:16:57.600 --> 0:17:00.280 so my point is is you see a man who 0:17:00.320 --> 0:17:06.200 comes in skeptical of, you know, of the far left. 0:17:06.240 --> 0:17:09.560 In the New Deal period, certainly wouldn't have identified with 0:17:09.600 --> 0:17:13.360 those folks, But who ends up believing in and building 0:17:13.680 --> 0:17:18.840 an institution of American capitalism that crafts markets toward a 0:17:18.880 --> 0:17:22.160 common good. And so that example is really inspiring. It's 0:17:22.160 --> 0:17:24.119 further back in history, but we've got all kinds of 0:17:24.160 --> 0:17:25.280 things that are closer. 0:17:26.040 --> 0:17:30.040 One of the criticisms of a lot of legacy institutions, 0:17:30.320 --> 0:17:33.920 whether it's universities or various parts of the public sector, 0:17:34.359 --> 0:17:37.640 et cetera, that comes from the right is that they've 0:17:37.680 --> 0:17:39.920 lost their own sense of mission. We have to tear 0:17:39.960 --> 0:17:42.439 them down because they have lost their own sense of mission. 0:17:42.680 --> 0:17:47.199 They're consumed with niche obsessions, consumed with identity things like 0:17:47.240 --> 0:17:50.760 that that are unrelated to their mission of whatever it 0:17:50.800 --> 0:17:53.840 is their building, whether it's homes, whether it's semiconductors, whether 0:17:53.840 --> 0:17:56.800 it's education. When you look at the history, do you 0:17:56.880 --> 0:18:02.520 see any evidence of sort of mission deviation or institutions 0:18:02.520 --> 0:18:03.960 that have lost their north star. 0:18:05.240 --> 0:18:07.480 It's not a pattern that I saw in the research 0:18:07.760 --> 0:18:11.200 of the book. And if that happens, that's what Congress 0:18:11.280 --> 0:18:15.199 is for. I mean, the Congress holds institutions accountable and 0:18:15.320 --> 0:18:18.720 monitors their activity. I mean, take the Chips Act. It 0:18:18.800 --> 0:18:23.040 was passed in twenty twenty two. But chips was actually 0:18:24.080 --> 0:18:26.120 an idea from the first Trump. 0:18:25.800 --> 0:18:27.120 Era that. 0:18:29.000 --> 0:18:33.280 Yeah, well yeah, and the Undersecretary of State for Economic 0:18:33.560 --> 0:18:36.560 Affairs and a whole set of folks were very. 0:18:36.359 --> 0:18:37.440 Invested in it. 0:18:37.440 --> 0:18:39.680 It gains steam and is passed in twenty twenty two, 0:18:40.440 --> 0:18:42.560 and then you know, quite quickly. 0:18:43.400 --> 0:18:45.520 Money begins to move. 0:18:46.000 --> 0:18:49.520 Congress actually a year later, says, you know what, We're 0:18:49.520 --> 0:18:54.919 going to exempt semiconductor construction from NIPA requirements, making the 0:18:55.000 --> 0:18:57.399 environmental requirements that in some cases could have made it 0:18:57.480 --> 0:19:00.680 harder to build. So Congress stepped in to make sure 0:19:00.680 --> 0:19:04.359 that something that they did actually happened more effectively. Or 0:19:04.400 --> 0:19:08.400 similarly with the FED, I mean, Congress is constantly tweaking 0:19:08.720 --> 0:19:10.639 the FED. Who gets to decide who's going to be 0:19:10.680 --> 0:19:15.359 a reserve beank president, even in some cases the methodologies 0:19:15.359 --> 0:19:17.000 for monetary policy implementation. 0:19:17.119 --> 0:19:19.960 So I think accountability is very important. 0:19:20.359 --> 0:19:23.639 But accountability rests in the legislative branch, not with an 0:19:23.680 --> 0:19:26.639 impulsive billionaire just running through town with a hammer. 0:19:27.240 --> 0:19:29.800 Speaking of the FED, I think you mentioned that you 0:19:29.840 --> 0:19:33.760 initially set out to write a book just right like 0:19:34.440 --> 0:19:36.280 what was the Cause of the Switch? And then I 0:19:36.280 --> 0:19:38.760 guess how did that inform your research process? 0:19:39.160 --> 0:19:40.639 So I have a special place in my heart for 0:19:40.680 --> 0:19:41.399 fed history. 0:19:41.800 --> 0:19:44.639 I've been working on a dissertation at Wharton for a 0:19:44.640 --> 0:19:48.320 few years which is more properly narrow and focused on 0:19:48.320 --> 0:19:51.119 that topic, and I thought that's what this book was 0:19:51.160 --> 0:19:56.440 going to be initially. But then when the conversation around 0:19:56.520 --> 0:20:01.879 industrial policy exploded, and the the Climate Bill happened, the 0:20:01.960 --> 0:20:05.639 Chips Bill happened, the Infrastructure Bill happened, a new conversation 0:20:05.720 --> 0:20:09.720 around tariffs in the Biden administration was happening, it felt 0:20:09.760 --> 0:20:12.480 like there was a bigger story to tell and the 0:20:12.600 --> 0:20:15.720 challenge that the thing I wanted to do was to 0:20:15.840 --> 0:20:18.800 explain how did we get from the era that I 0:20:18.880 --> 0:20:22.919 grew up in, you know, the Clinton and George W. 0:20:23.000 --> 0:20:27.879 Bush era where most people thought markets self regulate and 0:20:28.119 --> 0:20:32.560 work on their own, to a moment where both parties, 0:20:32.920 --> 0:20:36.639 both Democrats and Republicans, put the state at the center 0:20:36.920 --> 0:20:41.159 of the economic story. And I wanted to track that 0:20:41.359 --> 0:20:43.800 history in the past fifteen years and see it through 0:20:43.800 --> 0:20:46.840 the Great Recession and then the challenge of climate and 0:20:46.880 --> 0:20:49.960 then the rise of China and the pandemic, and understand 0:20:50.000 --> 0:20:54.879 how you got these bizarre agreements, like you know, almost 0:20:54.920 --> 0:20:58.879 a dozen Republicans voting for Lena Khan in the Senate 0:20:58.960 --> 0:21:01.439 to run the FTC. How did that happen? Where did 0:21:01.480 --> 0:21:04.760 that come from? And how enduring might that be? And 0:21:04.840 --> 0:21:07.720 that set of questions then took me way back into 0:21:07.760 --> 0:21:10.680 history and then back into the present day, and well, 0:21:10.680 --> 0:21:11.280 how did we. 0:21:11.240 --> 0:21:13.840 Get twelve Senate Republicans to vote for Lena Khan. 0:21:15.080 --> 0:21:18.679 I think the confluence of those four events made Americans, 0:21:18.760 --> 0:21:23.000 let alone policy makers, realized that markets don't just take 0:21:23.040 --> 0:21:27.080 care of themselves, and that that whole idea, that whole story, 0:21:27.680 --> 0:21:32.920 wasn't working. That capitalism needs to be cultivated, and that 0:21:32.960 --> 0:21:35.679 markets need to be cared for. In the introduction of 0:21:35.680 --> 0:21:39.280 the book, I talk about this metaphor of a vegetable garden, 0:21:39.320 --> 0:21:41.399 which might seem a little hokey, but at least for me, 0:21:41.600 --> 0:21:44.720 it's personal because when I grew up, I grew up 0:21:44.720 --> 0:21:48.200 in North Carolina in a small town, and my dad 0:21:48.520 --> 0:21:51.040 tilled up a third of the backyard to make a 0:21:51.080 --> 0:21:55.239 vegetable garden and constantly forced me in the summers to 0:21:55.320 --> 0:21:59.560 go like weed and pick green beans and steak tomatoes 0:21:59.560 --> 0:22:02.360 and do all these things that I did not want 0:22:02.359 --> 0:22:05.760 to do. Yeah, a lot of people enjoy this, it 0:22:05.760 --> 0:22:06.680 turns out me. 0:22:08.240 --> 0:22:08.400 So. 0:22:08.880 --> 0:22:11.280 But nonetheless, I spent an inordinate amount of time in 0:22:11.280 --> 0:22:14.520 that garden. And so when I started to think about, like, well, 0:22:14.520 --> 0:22:17.800 what are markets like if they're not these self regulating systems, 0:22:18.400 --> 0:22:22.080 the best metaphor that I that I landed upon is 0:22:22.160 --> 0:22:26.439 a garden because it recognizes there are organic forces that 0:22:26.480 --> 0:22:29.760 can sometimes be unruly, that won't necessarily cooperate and just 0:22:29.800 --> 0:22:33.520 do exactly what you want to do. But it also 0:22:33.600 --> 0:22:39.720 recognizes that you need care and cultivation to steer those plants. 0:22:39.720 --> 0:22:41.399 You need to plant some things in the sun and 0:22:41.440 --> 0:22:43.800 some things in the shades. You need fertilizer for some things, 0:22:43.800 --> 0:22:45.919 you need to get the weeds out for others. You 0:22:45.960 --> 0:22:47.959 need to shape these markets. You need to point them 0:22:48.000 --> 0:22:51.280 in a direction to ensure they're actually working, that they're 0:22:51.359 --> 0:22:54.959 producing a harvest that you want to eat and then 0:22:55.160 --> 0:22:57.439 and that is going to be nutritious. And so I 0:22:57.520 --> 0:23:00.320 kept coming back to that metaphor, and I think it 0:23:00.359 --> 0:23:01.520 is the right. 0:23:01.400 --> 0:23:03.760 One to think about how markets actually work. 0:23:04.359 --> 0:23:07.560 I want to say one thing about gardening, which is 0:23:07.640 --> 0:23:10.000 everyone has this image in their minds that it's like 0:23:10.040 --> 0:23:14.000 this really peaceful like pastoral activity, and it's not. It 0:23:14.080 --> 0:23:18.160 is like this violent struggle to stop everything from. 0:23:18.080 --> 0:23:19.480 Killing each other. Basically. 0:23:20.640 --> 0:23:25.800 Yeah, So I like the metaphor, okay, speaking of bad 0:23:25.840 --> 0:23:30.800 stuff happening. Almost every example in your book of you know, 0:23:30.920 --> 0:23:35.360 instances of market craft actually developing stems from a crisis 0:23:35.880 --> 0:23:39.200 of one sort or another. There's the Great Depression, There's 0:23:39.240 --> 0:23:43.960 obviously the COVID pandemic. You know, high inflation, high oil prices, 0:23:44.000 --> 0:23:46.720 things like that. Do you have to have a market 0:23:46.760 --> 0:23:50.600 crisis before people can start building consensus that there is 0:23:50.680 --> 0:23:53.399 actually a role for the government to come in and 0:23:53.440 --> 0:23:57.240 try to achieve some policy aims through market craft. 0:23:57.840 --> 0:24:01.520 No, but it helps, and it's always matters how you 0:24:01.520 --> 0:24:04.399 define the crisis. You know, there are several examples of 0:24:04.480 --> 0:24:08.040 market crafters who are very successful in the book, who 0:24:08.040 --> 0:24:10.920 are not responding to crisis. So I have an extended 0:24:10.960 --> 0:24:15.639 passage on Alan Greenspan, who is normally not thought of 0:24:15.720 --> 0:24:18.840 as like a market crafting kind of guy. He's supposed 0:24:18.880 --> 0:24:22.439 to be the deregulator in chief, and he did do 0:24:22.600 --> 0:24:24.840 plenty of that when he was the Chair of the FED, 0:24:25.480 --> 0:24:29.560 But he also had a vision, And so I'm going 0:24:29.640 --> 0:24:32.399 to use him as an example to make to make 0:24:32.440 --> 0:24:35.320 it clear that market craft is neither good nor bad 0:24:35.359 --> 0:24:37.800 and of itself, it matters. It's a tool and it's 0:24:37.840 --> 0:24:40.040 pointed towards a certain end, and it can be a 0:24:40.040 --> 0:24:41.520 good one or it can be a bad one. For 0:24:42.000 --> 0:24:48.000 green Span, it was financial innovation. He's so intensely believed 0:24:48.080 --> 0:24:53.359 that the more efficient markets would be, the more prosperity 0:24:53.520 --> 0:24:56.199 and stability would come out of that. I mean, the 0:24:56.240 --> 0:25:00.040 guy is writing papers when he's a young analyst in 0:25:00.080 --> 0:25:04.879 the fifties along these lines and eventually knits them together 0:25:04.920 --> 0:25:08.080 in his PhD dissertation, And then when he becomes chair 0:25:08.119 --> 0:25:10.760 of the Fed, Yeah, he does deregulate and take a 0:25:10.760 --> 0:25:14.080 lot of rules out of the way, but he also 0:25:14.840 --> 0:25:19.000 makes really important policy actions to encourage the development of 0:25:19.080 --> 0:25:22.840 financially innovative tools, things that we now know of as 0:25:23.240 --> 0:25:28.840 credit defaults, fops and special purpose vehicles and the kinds 0:25:28.880 --> 0:25:32.679 of things that did indeed significantly increase leverage in the 0:25:32.720 --> 0:25:37.600 financial sector, did in some cases mean markets moved faster 0:25:37.800 --> 0:25:42.040 and more efficiently, and he believed would ultimately create that 0:25:42.119 --> 0:25:45.960 kind of market discipline that would keep the whole system stable. 0:25:46.200 --> 0:25:47.160 So he had a goal. 0:25:47.600 --> 0:25:50.119 It was market it was financial innovation, and he was 0:25:50.240 --> 0:25:54.600 using the power of his institution to deliver on it. 0:25:54.600 --> 0:25:57.639 It's just it had disastrous consequences and he was wrong. 0:25:58.520 --> 0:25:59.440 Let's talk more about the event. 0:25:59.440 --> 0:26:01.760 By the way, I think it's really cool that you 0:26:01.840 --> 0:26:04.280 went and after, you know, after the Facebook, and did 0:26:04.280 --> 0:26:05.680 all this stuff, then you got your pH d. 0:26:06.280 --> 0:26:11.160 Well, we're still working on it, working on your PhD. 0:26:11.280 --> 0:26:14.639 I read Kevin Rudd, the former Prime Minister of Australia, 0:26:14.800 --> 0:26:16.600 after he was PM, went and got his pH d 0:26:16.720 --> 0:26:19.960 at Oxford and wrote an amazing book about hues and pain. 0:26:20.080 --> 0:26:22.040 So maybe there's hope. Maybe Tracy and I will get 0:26:22.240 --> 0:26:26.680 PhDs one day. But I hear different things about the 0:26:26.720 --> 0:26:29.600 history of what people call FED independence. 0:26:29.040 --> 0:26:31.960 And people in the old days presidents were always hectoring. 0:26:31.960 --> 0:26:33.919 The FED chief to do this or that and this 0:26:33.960 --> 0:26:35.879 isn't really that unusual, and other people like, oh no, 0:26:36.000 --> 0:26:38.440 this is a cherish thing, and we've that we ever, 0:26:38.800 --> 0:26:40.960 you know, interventioned by the White House. 0:26:40.920 --> 0:26:45.000 In your research on the FED, how unusual or. 0:26:45.040 --> 0:26:48.840 Usual is it for this sort of pressure that we see. 0:26:49.160 --> 0:26:53.480 Did presidents use to tweet to lower rates whatever the 0:26:53.480 --> 0:26:54.560 equivalent was back. 0:26:54.440 --> 0:26:54.760 In the day. 0:26:54.840 --> 0:26:58.159 Yeah, well, obviously it's a very timely topic given that 0:26:58.320 --> 0:27:00.520 you know, last week Pal was about be fired. This 0:27:00.560 --> 0:27:07.800 week apparently it was never even really considered. So there 0:27:07.880 --> 0:27:11.760 is a very long history of presidents trying to bully 0:27:11.800 --> 0:27:15.360 FED chairs to get what they want with monetary policy. 0:27:15.880 --> 0:27:19.040 It is, you know, virtually since the beginning of the institution, 0:27:19.400 --> 0:27:23.919 this has been a trend. Kennedy and Kennedy's administration does 0:27:23.960 --> 0:27:28.000 it with Bill Martin. In nineteen sixty, Lyndon Johnson summons 0:27:28.040 --> 0:27:30.960 the FED chair down to his ranch in Texas and 0:27:31.000 --> 0:27:35.480 takes him on this legendary jaunt. Richard Nixon is pressuring 0:27:35.640 --> 0:27:40.280 Arthur Burns. Reagan doesn't really like Vulcar so he replaces him. 0:27:40.320 --> 0:27:43.920 We could go through all of the examples, and this 0:27:44.080 --> 0:27:49.280 is different because this time the president isn't just pressuring 0:27:49.640 --> 0:27:53.159 the FED chair to do what he wants. He is 0:27:53.200 --> 0:27:58.160 threatening to take illegal action to fire him, which it's 0:27:58.280 --> 0:28:02.320 very clear in the Federal Reserve is not legal. The 0:28:02.359 --> 0:28:05.960 president can only remove the chair four cause, and similarly 0:28:05.960 --> 0:28:09.280 with the other members of the Board of Governors and 0:28:09.480 --> 0:28:12.840 so and it's not just a threat obviously like Trump 0:28:12.960 --> 0:28:15.200 has done this. He has fired two of the five 0:28:15.520 --> 0:28:19.760 FTC over at the FTC two of the five commissioners 0:28:19.760 --> 0:28:24.199 who are Democrats, also illegal in the FTC Act, it 0:28:24.280 --> 0:28:26.680 is illegal to fire them unless it's four casts. He's 0:28:26.680 --> 0:28:29.000 done at the NLRB, at the credit unions, et cetera. 0:28:29.359 --> 0:28:33.080 So I think this is a real threat. I tend 0:28:33.119 --> 0:28:36.520 not to use the word independence because I think the 0:28:36.600 --> 0:28:41.800 FED is actually quite sensitive to political and economic trends, 0:28:41.840 --> 0:28:44.959 what they're hearing in a lot of different domains. It 0:28:45.000 --> 0:28:48.080 is an insulated institution, which I think makes it stronger, 0:28:48.480 --> 0:28:51.560 but it is not a purely independent one. And these 0:28:51.600 --> 0:28:55.080 threats I think are really unprecedented and we should all 0:28:55.120 --> 0:29:12.840 be frightened by them. 0:29:13.000 --> 0:29:15.520 All right, So, speaking of things that might be different 0:29:15.760 --> 0:29:18.440 this time, we do have a president who seems very 0:29:18.520 --> 0:29:22.760 very determined to divorce the US in some ways from 0:29:22.920 --> 0:29:25.560 the rest of the global economy, the global financial system. 0:29:25.920 --> 0:29:28.160 The subtitle of your book is the one hundred Year 0:29:28.200 --> 0:29:31.800 Struggle to Shape the American Economy. You could easily have 0:29:31.880 --> 0:29:34.160 titled it the one hundred year Struggle for the US 0:29:34.240 --> 0:29:37.080 to shape the global economy, right, like, the US went 0:29:37.120 --> 0:29:40.720 on a very explicit mission to shape our current financial 0:29:40.760 --> 0:29:43.120 system and you do have a very chunky chapter in 0:29:43.160 --> 0:29:46.440 there about Breton Woods. Talk to us about why we 0:29:46.440 --> 0:29:50.719 should all, I guess, familiarize ourselves with things like Breton Woods, 0:29:50.760 --> 0:29:53.920 euro dollars, capital controls in our current climate. 0:29:55.120 --> 0:29:56.480 Let me tell you a little bit of the story 0:29:56.520 --> 0:29:59.360 of the breakdown of Brettonwoods and why it matters for today, 0:29:59.440 --> 0:30:02.480 because when I wrote that chapter, I had no idea 0:30:03.160 --> 0:30:07.520 that the dollar would actually be threatened as the global 0:30:07.560 --> 0:30:08.960 reserve currency. 0:30:09.080 --> 0:30:10.720 And this is real. 0:30:11.840 --> 0:30:14.680 So BRETTONWOODZ was this agreement that came out of World 0:30:14.760 --> 0:30:19.560 War Two that where the United States committed to sell 0:30:19.760 --> 0:30:23.600 gold at thirty five dollars announce and it would peg 0:30:23.680 --> 0:30:27.560 the dollar to all other foreign currencies. So this way, 0:30:27.680 --> 0:30:32.120 the dollar effectively became the bedrock of the global financial system. 0:30:32.400 --> 0:30:35.640 And underneath it there was gold, so it was an 0:30:35.680 --> 0:30:39.400 effective gold standard. But the United States was making the 0:30:39.400 --> 0:30:44.080 commitment to be able to redeem dollars for gold should 0:30:44.280 --> 0:30:46.479 a foreign country or anyone else in the market and 0:30:46.520 --> 0:30:49.960 want to make that exchange. Now, the whole system was 0:30:50.040 --> 0:30:53.280 premised on the fact that as the rest of the 0:30:53.320 --> 0:30:57.280 economy grew, the United States had to increase the amount 0:30:57.360 --> 0:31:02.160 of dollars in circulation for time, because as economies grow, 0:31:02.240 --> 0:31:04.680 they need more currency. If the dollar is the base currency, 0:31:04.960 --> 0:31:10.000 is the global standard, you need more of it. One problem, 0:31:10.720 --> 0:31:14.680 the more dollars you print, the less they're worth. And 0:31:14.760 --> 0:31:17.320 so by its very nature, you are not going to 0:31:17.320 --> 0:31:21.320 be able to deliver on the promise to redeem gold 0:31:21.480 --> 0:31:25.440 at thirty five dollars announce. So it's like a vice 0:31:25.560 --> 0:31:29.920 that tightens between nineteen forty, between the post war years 0:31:30.040 --> 0:31:34.680 and nineteen seventy one, when it gets just so impossible 0:31:34.840 --> 0:31:37.960 for the United States to continue this commitment, there's a run, 0:31:38.520 --> 0:31:41.360 and I tell the story of the book where Nixon 0:31:41.800 --> 0:31:45.640 summons every single person who runs any of the economic 0:31:45.720 --> 0:31:48.640 institutions in the country to Camp David, and they come 0:31:48.720 --> 0:31:52.680 up with a plan, and they end the Breton Woods system. 0:31:52.880 --> 0:31:57.479 They in the gold commitment, and they move into a 0:31:57.520 --> 0:32:01.080 regime of eventually it becomes a regime of float exchange rates. 0:32:01.440 --> 0:32:03.880 Now we make it through partially because price and wage 0:32:03.880 --> 0:32:08.320 controls hold down inflation for a period, etc. But it 0:32:08.360 --> 0:32:10.720 is touch and go for a lot of that period. 0:32:10.920 --> 0:32:13.480 And so then you fast forward to today, and I 0:32:13.480 --> 0:32:16.200 think the easiest way to think about it is, instead 0:32:16.200 --> 0:32:20.480 of gold being that thing underneath the dollar that guarantees 0:32:20.520 --> 0:32:25.840 its value. It's the institutions of American capitalism. So the 0:32:25.920 --> 0:32:29.320 dollar continues to be the global reserve currency today. And 0:32:29.360 --> 0:32:32.560 the reason that is is because we have had an 0:32:32.560 --> 0:32:36.200 independent central bank, We have had a treasury that reliably 0:32:36.240 --> 0:32:40.280 and always pays the coupon on its debt in a 0:32:40.320 --> 0:32:44.480 way that investors can believe in and expect. And so 0:32:44.880 --> 0:32:48.480 does people want dollars. People want us treasuries, people want 0:32:48.480 --> 0:32:52.000 these financial assets. And now two things are throwing that 0:32:52.040 --> 0:32:56.400 into question. The first, obviously is Trump's impulsive economic policy, 0:32:56.440 --> 0:32:59.800 which disregards the importance of institutions in the first place. 0:33:00.200 --> 0:33:03.760 But the second is we're flooding the market yet again 0:33:04.280 --> 0:33:09.040 with dollars and dollar denominated assets. Like the deficit last 0:33:09.080 --> 0:33:11.920 year was seven percent of GDP. It's not supposed to 0:33:11.960 --> 0:33:14.360 be that high in a healthy economy. And right now 0:33:14.400 --> 0:33:18.080 the plan is another six trillion dollars of tax cuts, 0:33:18.360 --> 0:33:21.680 which is just to give it for perspective, is as 0:33:21.760 --> 0:33:24.480 much as the tax cuts of Trump one point zero 0:33:24.920 --> 0:33:29.920 and the pandemic aid combined. And we're already at seven 0:33:29.960 --> 0:33:33.040 percent of g So we have another moment where we've 0:33:33.080 --> 0:33:37.120 flooded the world with dollars where they're losing value and 0:33:37.360 --> 0:33:41.040 the underlying guarantee of that value, the security of American 0:33:41.600 --> 0:33:45.840 capitalists institutions is under threat, and so you're seeing an 0:33:45.920 --> 0:33:49.960 unprecedented period and a potential run do it. 0:33:50.080 --> 0:33:53.760 Yesterday night there was a news story President Trump said 0:33:53.760 --> 0:33:57.160 he wouldn't want to raise taxes on millionaires because it 0:33:57.160 --> 0:34:01.520 would be quote disruptive to the and then he said 0:34:01.520 --> 0:34:04.000 that the millionaires would leave the country, which I'd hope 0:34:04.040 --> 0:34:06.680 most of them would be, uh, you know, stick around. 0:34:06.800 --> 0:34:09.000 But that's his view of them. 0:34:09.160 --> 0:34:11.239 But what does it say, you know, about even the 0:34:11.320 --> 0:34:16.160 prospect for market craft if people in government don't feel 0:34:16.239 --> 0:34:19.320 that they have the capacity, the political power, et cetera 0:34:19.680 --> 0:34:23.520 to at times bring pockets of wealth truly healed, so 0:34:23.640 --> 0:34:26.799 to speak, and to wield that power, or were they like, 0:34:26.920 --> 0:34:30.080 is there any prospect for positive market craft in a 0:34:30.160 --> 0:34:34.520 world where politicians feel that like they're subservient to. 0:34:36.000 --> 0:34:37.000 Huge pockets of wealth. 0:34:37.760 --> 0:34:39.600 I very much think so. 0:34:39.600 --> 0:34:43.600 So I'm skeptical in this administration that that's gonna happen, 0:34:44.520 --> 0:34:47.719 but I think there's all kinds of opportunities for positive 0:34:47.920 --> 0:34:49.799 market crafts. So the things that I focus on these 0:34:49.880 --> 0:34:53.520 days are the cost of living crisis in the United States. 0:34:53.640 --> 0:34:56.680 I mean, that is what voters are very clearly still 0:34:57.040 --> 0:35:01.240 frustrated about. Prices are up twenty percent from the beginning 0:35:01.280 --> 0:35:05.560 of the pandemic till now, and it's particularly concentrated in 0:35:05.600 --> 0:35:07.680 things like housing. I meaner can spend a third of 0:35:07.719 --> 0:35:11.360 their income on housing, and then if you go to groceries, 0:35:11.400 --> 0:35:14.920 and then you go to care, healthcare, childcare, you're above 0:35:14.960 --> 0:35:19.560 fifty percent for most families. And so we can craft 0:35:19.719 --> 0:35:23.840 housing markets to make housing cheaper. We can certainly do 0:35:23.880 --> 0:35:26.800 some of the zoning and streamlining that the abundance folks 0:35:26.840 --> 0:35:29.120 like Ezra Kline and others are for. I think that's 0:35:29.160 --> 0:35:29.840 a good idea. 0:35:29.880 --> 0:35:30.319 I kind of. 0:35:30.239 --> 0:35:33.920 Wondered how long it would take us before I mentioned abundant. 0:35:33.719 --> 0:35:38.040 We got it's pretty good. I think that those are 0:35:38.040 --> 0:35:38.760 good ideas. 0:35:38.840 --> 0:35:41.480 But I also don't think that you can just make 0:35:41.520 --> 0:35:44.560 it easier to build and then sit back and hope 0:35:44.560 --> 0:35:46.360 people show up. At least that's not been the experience 0:35:46.360 --> 0:35:49.839 in California. Like it's been years since they have been 0:35:49.840 --> 0:35:52.160 on this process of trying to change their laws and 0:35:52.400 --> 0:35:54.800 building starts are not showing the same kind of growth 0:35:54.800 --> 0:35:57.800 that you would like. You have to craft markets more aggressively. 0:35:57.840 --> 0:36:02.000 There's a lot of other tools, particular public investment. So 0:36:02.040 --> 0:36:08.480 we need a housing construction fund for multifamily developers to 0:36:08.960 --> 0:36:11.359 make it cheaper to build. You guys have had some 0:36:11.440 --> 0:36:14.640 folks on your podcast make who make this case. You know, 0:36:14.680 --> 0:36:17.440 the estimates are that for an investment of about fifty 0:36:17.440 --> 0:36:20.560 billion dollars at a federal level, you could get somewhere 0:36:20.600 --> 0:36:23.720 between one and two million home spell and that's about 0:36:23.719 --> 0:36:26.480 half the housing shortfall in the United States. That's quite 0:36:26.480 --> 0:36:29.560 a lot of progress. You could have an industrial policy 0:36:29.600 --> 0:36:33.240 for modular. So modular is the kind of housing where 0:36:33.400 --> 0:36:35.520 you build the components off site and then you bring 0:36:35.560 --> 0:36:38.399 them in. And there's this amazing time lass video which 0:36:38.400 --> 0:36:41.800 I saw about six weeks ago of an apartment building 0:36:41.920 --> 0:36:45.560 in Denver where they bring in the pieces and it 0:36:45.560 --> 0:36:48.080 goes so quickly. It looks like the Mike Sun places 0:36:48.120 --> 0:36:52.440 with magnetiles, these like pies. They're amazing. But you just 0:36:52.520 --> 0:36:55.720 see it, and you just watch this. This apartment building 0:36:55.760 --> 0:36:59.520 with seventy seven units go up in the course of 0:36:59.640 --> 0:37:04.680 seven days, and it's mind blowing. And half of the 0:37:04.680 --> 0:37:07.400 building that happens in the Nordic countries is through modular 0:37:07.800 --> 0:37:12.040 and so that's a kind of industry that I think 0:37:12.040 --> 0:37:14.600 if we had an industrial policy to encourage and not 0:37:14.680 --> 0:37:18.359 just public investment, but also standard setting making sure it's 0:37:18.400 --> 0:37:21.520 possible for people to get mortgages for them, you could 0:37:21.520 --> 0:37:23.960 see significantly more development. So I think we need a 0:37:24.000 --> 0:37:26.759 market craft for housing. On food, I think we could 0:37:26.760 --> 0:37:31.080 do reserve stock buffering on eggs and coffee, like I 0:37:31.160 --> 0:37:34.200 talk about in the book on care, there's a whole 0:37:34.200 --> 0:37:37.319 set of interventions as well. There's an aspirational agenda, is 0:37:37.320 --> 0:37:40.080 what I'm trying to say, that could help us attack 0:37:40.120 --> 0:37:44.279 the cost of living crisis. And this administration is going 0:37:44.320 --> 0:37:47.960 to hike prices through the tear of policy, not bring 0:37:48.000 --> 0:37:50.560 them down. And so Democrats are going to have to 0:37:50.600 --> 0:37:55.040 have another message and also the specific policy expertise to 0:37:55.640 --> 0:37:56.440 get it done. 0:37:56.680 --> 0:37:58.840 Yeah, there's a long running joke on all Blots that 0:37:58.840 --> 0:38:01.400 what America really needs is a strategic pork preserve. 0:38:01.600 --> 0:38:03.680 I think all agree on this. 0:38:04.800 --> 0:38:09.040 Okay, speaking of agreeing, one of the chapters in your 0:38:09.040 --> 0:38:12.040 book that I really enjoyed was the sort of behind 0:38:12.040 --> 0:38:14.360 the scenes look at Bidenomics. 0:38:14.680 --> 0:38:16.400 Yeah, and you. 0:38:16.280 --> 0:38:18.960 Do get a really good sense of some of the 0:38:19.239 --> 0:38:23.600 discussions that take place, the areas of disagreement. The sort 0:38:23.640 --> 0:38:28.040 of protagonist and antagonist, I guess in this discussion in 0:38:28.080 --> 0:38:32.120 your book is Larry Summers versus Brian Deese exactly. And 0:38:32.160 --> 0:38:35.600 you were also involved in the Obama administration, like talk 0:38:35.640 --> 0:38:38.440 to us what you learned about the actual sausage making 0:38:38.520 --> 0:38:42.520 process of market craft and what sort of like how 0:38:42.520 --> 0:38:45.040 do people actually reach consensus on a lot of these 0:38:45.080 --> 0:38:48.719 things when they have very different opinions about how the 0:38:48.719 --> 0:38:49.640 world works. 0:38:50.440 --> 0:38:53.879 So I had this experience where in writing for most 0:38:53.880 --> 0:38:59.239 of the book, I was largely in archives and secondary 0:38:59.239 --> 0:39:01.719 literature in the past, and then the last third of 0:39:01.719 --> 0:39:06.200 the book is contemporary, and so the methodology just shifted 0:39:06.640 --> 0:39:09.879 to talking to a lot of people. So I ended 0:39:10.000 --> 0:39:12.879 up talking to most of the folks who had been 0:39:12.880 --> 0:39:16.879 involved in Bidenomics inside the administration, and people like Larry 0:39:16.880 --> 0:39:18.520 Summers and Jason Furman and a lot of people on 0:39:18.560 --> 0:39:18.759 the LM. 0:39:18.840 --> 0:39:19.920 Larry does like to talk. 0:39:20.560 --> 0:39:21.600 It turns out. 0:39:23.239 --> 0:39:25.320 I talked to a lot of people, and the person 0:39:25.360 --> 0:39:28.280 that I zeroed in on was this man named Brian Deese, 0:39:28.320 --> 0:39:31.160 who some of you may know. He has an odd 0:39:31.200 --> 0:39:35.640 launch guest. Indeed, he was the chair of the National 0:39:35.680 --> 0:39:38.960 Economic Council. The reason he's so interesting is because he 0:39:39.120 --> 0:39:43.320 was one of Larry's protegees in two thousand and eight. 0:39:43.480 --> 0:39:45.880 In two thousand and nine, he is on the Obama 0:39:45.920 --> 0:39:50.920 campaign and he effectively runs the bailout of the auto companies, 0:39:51.800 --> 0:39:55.400 and in that experience begins to see, wait a second, 0:39:55.880 --> 0:39:58.840 we can't just be bailing. We can't have the emergency 0:39:58.880 --> 0:40:01.520 room view of the economy where we come afterward. We 0:40:01.600 --> 0:40:04.719 have to be thinking proactively ahead of time about how 0:40:04.719 --> 0:40:07.279 to shape and build industries that work better. That takes 0:40:07.360 --> 0:40:09.960 him to work on climate change. And then all of 0:40:10.000 --> 0:40:14.480 a sudden the Biden administration, he becomes a director of 0:40:14.560 --> 0:40:17.080 the National Economic Council, and then he. 0:40:17.880 --> 0:40:20.600 Articulates this big vision. It has two pillars. 0:40:20.840 --> 0:40:24.480 The first is build, so that's public investment in climate 0:40:25.280 --> 0:40:29.800 infrastructure and chips. And the second is balance, so that's 0:40:30.080 --> 0:40:36.080 competition in particular, but also supporting labor and other similar 0:40:36.160 --> 0:40:40.600 kinds of initiatives to ensure that the economy is competitive. 0:40:40.920 --> 0:40:46.360 And boy, Larry doesn't like it. He is throwing rocks 0:40:46.360 --> 0:40:49.480 from the outside pretty much the entire time, and often 0:40:49.560 --> 0:40:52.360 talking to Brian and others on the inside. And the 0:40:52.360 --> 0:40:55.280 reason I think that story is so powerful is because 0:40:55.800 --> 0:40:59.920 it shows the emergence of not just a new generation 0:41:00.080 --> 0:41:03.839 and of policymakers, but a new way of thinking about 0:41:03.840 --> 0:41:07.480 the economy which starts from the premise of market craft 0:41:07.880 --> 0:41:11.840 and doesn't fall back into kind of neoclassical economic framework 0:41:12.000 --> 0:41:15.279 of market failures and externalities. And how are we going 0:41:15.320 --> 0:41:17.000 to fix things after the fact? 0:41:17.320 --> 0:41:20.120 I guess I have more of a politics question, or 0:41:20.160 --> 0:41:23.400 you know, we had this sort of nascent industrial policy 0:41:23.440 --> 0:41:26.279 market crafting, and then it looks like the plug is 0:41:26.320 --> 0:41:29.440 being pulled after four years, and I would guess that 0:41:29.520 --> 0:41:32.200 there must be a lot of frustration among Democrats to 0:41:32.239 --> 0:41:35.279 hear someone run on, We're going to build things in 0:41:35.320 --> 0:41:39.080 America again, We're going to build manufacturing right after a 0:41:39.120 --> 0:41:42.440 period of two or three years in which more plants 0:41:42.520 --> 0:41:46.040 were opened and more factories were broken ground on than 0:41:46.120 --> 0:41:48.880 any time in my life. And so what I'm curious 0:41:49.040 --> 0:41:53.600 from your perspective, I guess from a political sustainability standpoint 0:41:53.800 --> 0:41:59.000 is people seem to like in theory the idea of manufacturing, 0:41:59.040 --> 0:42:02.279 the aesthetics of it, but do people actually like it 0:42:02.360 --> 0:42:05.120 in practice? Or is like because it didn't seem like 0:42:05.160 --> 0:42:07.080 it got any results politically. 0:42:07.480 --> 0:42:09.960 I don't know if manufacturing per se is the thing 0:42:09.960 --> 0:42:12.680 that people like. And I'm a little skeptical that you're 0:42:12.680 --> 0:42:17.200 going to really reinvigorate the American economy by rebuilding a 0:42:17.360 --> 0:42:21.680 manufacturing sector. But I'm not quite sure I agree with 0:42:21.719 --> 0:42:25.280 the premise of the question. Trump is certainly not pursuing 0:42:25.280 --> 0:42:28.840 a market craft, that's clear. However, a lot of the 0:42:28.840 --> 0:42:33.560 people around him have spent years developing their own visions 0:42:33.800 --> 0:42:36.560 of a market craft that puts the state at the center. 0:42:36.760 --> 0:42:38.680 So you're talking about or in Cass in your book, 0:42:38.719 --> 0:42:39.440 for example. 0:42:39.200 --> 0:42:41.240 Well, or in Cass, But I'm talking about Marco Rubio 0:42:41.320 --> 0:42:43.800 and JD. Vance and Josh Holly, a lot of these 0:42:44.360 --> 0:42:48.000 guys who I think are the future of the Republican Party, 0:42:48.440 --> 0:42:53.240 who believe that we need state institutions to direct markets 0:42:53.239 --> 0:42:56.480 towards certain goals. Now, their goals are not really my goals, 0:42:56.600 --> 0:42:58.640 I should say that. I mean, they are very concerned 0:42:58.640 --> 0:43:03.000 about drone and critical minerals and national security, whereas I'm 0:43:03.360 --> 0:43:07.520 more interested in climate change and other things. But nonetheless, 0:43:07.840 --> 0:43:12.239 right before Vance became the vice presidential nominee, he was 0:43:12.280 --> 0:43:16.640 about to introduce a bill for a national Investment Bank, 0:43:17.480 --> 0:43:19.680 the same idea that I was just talking about from 0:43:19.719 --> 0:43:24.320 the New Deal era, that he believed as an institution 0:43:24.880 --> 0:43:27.080 would have the power to direct markets. Now he was 0:43:27.080 --> 0:43:30.000 doing that with Chris Coons and Mark Warner and folks 0:43:30.000 --> 0:43:32.080 on the left. But what I'm trying to say is 0:43:32.239 --> 0:43:35.759 it may be dormant in this period, but I don't 0:43:35.800 --> 0:43:37.959 think that ideology is gone. We're going to hear about 0:43:37.960 --> 0:43:39.920 a sovereign wealth fund in the next few weeks from 0:43:39.920 --> 0:43:44.400 this administration, and there's a deadline that the Treasury Secretary 0:43:44.440 --> 0:43:46.800 will have to bring a report on it. I wouldn't 0:43:46.800 --> 0:43:51.080 be surprised if we see some trace remnants there. Even 0:43:51.120 --> 0:43:53.879 though I am skeptical that anything meaningfully will be will 0:43:53.920 --> 0:43:56.960 be done. I don't think that means that it's that 0:43:57.000 --> 0:44:00.680 Trump's chaos can define the Republican Party for wherever and ever. 0:44:01.680 --> 0:44:03.880 We do have some questions from the audience that we 0:44:03.880 --> 0:44:08.719 should probably bring in. I'll start with one, obviously very 0:44:08.719 --> 0:44:12.280 topical at the moment, but how is market craft playing 0:44:12.400 --> 0:44:15.960 into the race for dominance in artificial intelligence? 0:44:17.800 --> 0:44:18.040 Yeah? 0:44:18.120 --> 0:44:22.480 I mean, so far, the federal government has decided to 0:44:22.560 --> 0:44:26.560 let the private sector, you know, develop AI on its own. 0:44:26.640 --> 0:44:28.760 In the United States, it's certainly different than in China 0:44:28.800 --> 0:44:33.120 and then elsewhere, and there hasn't been a market craft. 0:44:33.160 --> 0:44:35.320 There's been talk of it in the Senate in particular. 0:44:35.360 --> 0:44:39.960 There's interest in public investment. There's been talk of what 0:44:40.000 --> 0:44:43.680 we call public option for the cloud, so a way 0:44:43.719 --> 0:44:47.640 of making it easier for smaller companies to access computing 0:44:47.680 --> 0:44:51.600 powder to build advanced AI models. But none of that 0:44:51.680 --> 0:44:55.239 has yet come to fruition, And so I think it's 0:44:55.280 --> 0:44:57.920 important to say that, like, market craft isn't everywhere all 0:44:57.960 --> 0:45:01.360 the time. You know, lots of policies effect markets, but 0:45:01.440 --> 0:45:03.920 the craft and market you have to have, you know, 0:45:04.000 --> 0:45:08.680 policy makers with a clear intent shaping it and guiding it. 0:45:08.800 --> 0:45:12.080 And so far in the AI markets it's been more 0:45:12.080 --> 0:45:13.040 of a hands off kind. 0:45:12.880 --> 0:45:15.200 Of But if we had like a loan office for 0:45:15.400 --> 0:45:19.000 AI startups something like that would count as explicit market 0:45:19.000 --> 0:45:19.719 craft for sure. 0:45:19.719 --> 0:45:23.200 If Congress said, hey, we want more small businesses doing AI, 0:45:23.400 --> 0:45:25.239 so we're going to appropriate money and we're going to 0:45:25.400 --> 0:45:27.600 create an office over here in the Commerce Department to 0:45:27.680 --> 0:45:30.680 do that, they're there, they have they have an agenda, 0:45:30.680 --> 0:45:33.200 they're crafting that market just putting. 0:45:32.880 --> 0:45:36.480 It back on your tech founder for a second, kind 0:45:36.480 --> 0:45:38.239 of separate from market craft, but I guess it sort 0:45:38.239 --> 0:45:41.800 of intersects with this. When Deep Seat came out, people 0:45:41.840 --> 0:45:44.319 started really and it was before that too, but people 0:45:44.480 --> 0:45:49.000 really started to talking about AI specifically. Is this existential 0:45:49.120 --> 0:45:52.759 area of competition kind of like uh, kind of like 0:45:52.800 --> 0:45:54.120 achieving the nuclear bomb? 0:45:54.200 --> 0:45:56.359 Like who is going to get to AGI first? US 0:45:56.440 --> 0:45:57.160 or China? 0:45:57.320 --> 0:45:58.080 Do you uh? 0:45:58.520 --> 0:46:01.919 I mean, do you think of AI or AGI specifically 0:46:02.480 --> 0:46:03.800 in such stakes? 0:46:05.440 --> 0:46:07.279 It's a huge deal. I'm not sure I want to 0:46:07.280 --> 0:46:09.640 go to the nuclear bomb. That seems like a very 0:46:09.719 --> 0:46:13.400 high bar, but it's a huge deal. I think that 0:46:13.600 --> 0:46:18.880 the advances in AI, it's certainly the most profound changes 0:46:18.920 --> 0:46:22.879 in technology in my I think, I want to say, 0:46:22.880 --> 0:46:25.440 in my life. It feels more transformative to me than 0:46:25.440 --> 0:46:28.239 the mobile phone, which I think would be my bar. 0:46:28.520 --> 0:46:30.680 I mean, it's I'm using the models. 0:46:31.120 --> 0:46:33.800 My husband's in the front row, he watches me, and 0:46:33.800 --> 0:46:36.960 to use the models all day every day for everything 0:46:37.000 --> 0:46:42.240 from like recipe substitutions to you know, doing deep research 0:46:42.280 --> 0:46:44.120 on a particular topic. Of course, you have to check 0:46:44.160 --> 0:46:46.399 the facts, this and that, but I mean they are 0:46:46.440 --> 0:46:48.200 incredibly powerful, Tracy. 0:46:48.280 --> 0:46:51.240 I have to say, like I'm an AI user enthusiast 0:46:51.280 --> 0:46:51.760 for Tracy. 0:46:51.800 --> 0:46:54.200 I to watch Joe use the models all day. 0:46:54.360 --> 0:46:55.080 You don't use them. 0:46:55.680 --> 0:46:57.640 I do know, I do it, just not as. 0:46:57.640 --> 0:46:59.560 Much as way. 0:47:00.040 --> 0:47:04.000 I am an enthusiastic trier outer of all the AI models, 0:47:04.000 --> 0:47:08.840 and I recently got access to Mannus. Yeah, but I 0:47:08.880 --> 0:47:12.120 have yet to find an application that consistently enhances my 0:47:12.360 --> 0:47:13.319 work productivity. 0:47:13.360 --> 0:47:14.479 Really, Yeah, that's not true. 0:47:14.880 --> 0:47:17.000 Okay, headlining, I haven't. 0:47:17.280 --> 0:47:19.040 But I'm better at headlines, of course you are. 0:47:19.280 --> 0:47:19.480 No. 0:47:19.480 --> 0:47:22.400 No, but that's of course you are. But it's helpful 0:47:22.440 --> 0:47:26.320 to have a kind of sidekick to brainstorm headline Tracy. 0:47:26.520 --> 0:47:29.880 Okay, well, fair enough. Not all of us have, Tracy. 0:47:31.040 --> 0:47:34.080 No, I disagree with this. Like AI is a phenomenal 0:47:34.120 --> 0:47:36.960 tool for our day to day productivity, it just is. 0:47:39.120 --> 0:47:42.560 Why did I ask another question from the audience. I 0:47:42.600 --> 0:47:44.399 know you care about climate change and this is one 0:47:44.400 --> 0:47:46.839 of your big projects. So we have someone asking how 0:47:46.880 --> 0:47:49.600 do we make progress with climate policy in light of 0:47:49.640 --> 0:47:55.200 its politicization, politicalization and the issue of affordability. And one 0:47:55.239 --> 0:47:57.480 thing I would just add on to that question is, 0:47:58.080 --> 0:48:01.000 you know, one of the things we've seen under binomics 0:48:01.160 --> 0:48:04.920 was Oh, we should build more green technology in the US, 0:48:05.280 --> 0:48:07.919 and a lot of that makes sense. But I guess 0:48:07.960 --> 0:48:10.800 the counter argument to doing that is, if we really 0:48:10.840 --> 0:48:13.719 care about the climate, and if there is actually this 0:48:14.000 --> 0:48:16.960 massive sense of urgency to doing something about it, then 0:48:17.600 --> 0:48:21.239 why not get all the really cheap solar panels in 0:48:21.600 --> 0:48:23.480 volume from a place like China. 0:48:24.600 --> 0:48:30.040 Well, I think we need even more investment, likely significantly 0:48:30.080 --> 0:48:33.279 more investment than we got out of the IRA, and 0:48:33.600 --> 0:48:36.759 we need it to be better coordinated. So I think 0:48:36.760 --> 0:48:41.040 the IRA investments are still stand. Obviously, business uncertainty has 0:48:41.080 --> 0:48:43.239 just gone through the roof, so no one exactly knows 0:48:43.280 --> 0:48:47.000 what's going to happen. There are signs that the Republicans 0:48:47.040 --> 0:48:50.239 will keep some of the pieces of the IRA, maybe 0:48:50.239 --> 0:48:53.319 not for solar panels or evs, but for things like 0:48:53.640 --> 0:48:59.359 hydrogen or carbon capture or things like that. I'm cautiously optimistic, 0:48:59.560 --> 0:49:03.040 but we need additional investment, and then we do really 0:49:03.080 --> 0:49:07.400 need an institution whose mission it is to tackle climate change, 0:49:07.440 --> 0:49:10.040 and the Congress can hold accountable so that instead of 0:49:10.080 --> 0:49:12.040 just saying, oh, we're going to give subsidies through the 0:49:12.040 --> 0:49:15.360 tax code, where the government effectively has no ability to 0:49:15.400 --> 0:49:17.720 determine what's getting the most funding. 0:49:18.080 --> 0:49:20.440 There is an ability to say. 0:49:20.239 --> 0:49:24.759 Okay, this, these breakthrough technologies need more support. These other 0:49:24.800 --> 0:49:27.799 things are doing just fine. I think that's going to 0:49:27.800 --> 0:49:31.000 be the long term solution. I'm a bit I'm with you. 0:49:31.239 --> 0:49:34.200 I'm not sure that tariffs on solar panels are going 0:49:34.280 --> 0:49:38.479 to help us get to the you know, the tools 0:49:38.520 --> 0:49:40.600 that we need to combat climate change that we need. 0:49:41.120 --> 0:49:42.040 Trace is right by the way. 0:49:42.080 --> 0:49:44.160 I get a couple when it comes to AI, I 0:49:44.320 --> 0:49:45.640 sometimes be like, okay, we're in. 0:49:45.719 --> 0:49:48.239 I know because I literally watch you do this. 0:49:49.000 --> 0:49:51.200 Joe was at the I co host the Audlats podcast. 0:49:51.239 --> 0:49:53.759 We're interviewing Chris used tonight that your public library. What 0:49:53.800 --> 0:49:55.839 would be some questions I do ask that and I 0:49:55.920 --> 0:49:58.200 sometimes upload PDFs and just like just give me to 0:49:58.200 --> 0:49:58.680 the summary. 0:49:59.480 --> 0:50:01.000 So I wanted with me. 0:50:01.080 --> 0:50:03.080 Yeah, yeah, no, that is helpful. It's helpful. 0:50:06.040 --> 0:50:09.920 Someone to ask about student loans. And I'm curious, you know, 0:50:10.440 --> 0:50:14.560 people perceive the market for higher education to be broken 0:50:14.880 --> 0:50:18.080 in various ways, and I'm curious whether it's on the 0:50:18.120 --> 0:50:22.120 funding side for the consumer, the student, or whether there's 0:50:22.160 --> 0:50:24.160 anything interesting that you've learned. 0:50:23.960 --> 0:50:25.080 About that space. 0:50:25.480 --> 0:50:27.400 Yeah, so there are a lot of these markets that 0:50:27.400 --> 0:50:31.800 I would call gray zones. Is higher education a market, 0:50:32.640 --> 0:50:34.839 at least the way that I want to think about 0:50:34.880 --> 0:50:36.880 it most of the time, it's not. It should just 0:50:36.920 --> 0:50:40.600 be a fundamental, you know, good an opportunity that everybody 0:50:40.640 --> 0:50:41.920 can get an education. 0:50:42.040 --> 0:50:43.040 That they want. 0:50:43.440 --> 0:50:46.640 So I'm not sure we even have to use a 0:50:46.680 --> 0:50:49.440 market crafting framework to say, you know, college in the 0:50:49.560 --> 0:50:54.280 United States should at least be affordable, if not free, 0:50:54.600 --> 0:50:57.920 and there's a way to use policy to make that happen. 0:50:57.960 --> 0:51:00.239 But I think that it is due for sort of 0:51:00.239 --> 0:51:06.320 wholesale reimagination, and there is something wonderfully simple and direct 0:51:06.640 --> 0:51:11.000 about you know, Bernie's promise for free college that you 0:51:11.040 --> 0:51:13.239 know is hard to do, but I think it's that 0:51:13.400 --> 0:51:18.600 kind of aspirational guarantee that people crave, people respond to, 0:51:18.680 --> 0:51:21.840 and it's policy makers response to deliver on that. Of course, 0:51:22.520 --> 0:51:24.360 you're going to have to raise taxes, whether it's for 0:51:24.440 --> 0:51:26.160 this or some of the other issues that we've talked 0:51:26.160 --> 0:51:30.520 about to make that happen, But I don't know that 0:51:30.800 --> 0:51:32.920 that's the I think that's the kind of country I 0:51:32.920 --> 0:51:34.200 want to live in. I think that's the kind of 0:51:34.200 --> 0:51:35.880 country that most Americans want to live in. 0:51:36.640 --> 0:51:38.839 It's a great place to leave it. Chris Hughes, thank 0:51:38.920 --> 0:51:39.800 you so much. 0:51:39.600 --> 0:51:53.399 For joining us in this live episode. 0:51:59.640 --> 0:52:02.560 That is our interview with Chris Hughes, the author of 0:52:02.719 --> 0:52:05.840 Market Crafters, live at the New York Public Library. 0:52:05.960 --> 0:52:09.160 Really good evening, really interesting topic. One very near and 0:52:09.200 --> 0:52:12.080 dear to the themes that we've been talking about on odline. 0:52:12.160 --> 0:52:14.160 Yeah, definitely touches on a lot of them. 0:52:14.239 --> 0:52:15.799 Shall we leave it there, Let's leave it there. 0:52:15.960 --> 0:52:18.360 This has been another episode of the Odd Lots podcast. 0:52:18.400 --> 0:52:21.640 I'm Tracy Alloway. You can follow me at Chacy Alloway, and. 0:52:21.600 --> 0:52:24.160 I'm Joe Wisenthal. You can follow me at the Stalwart. 0:52:24.400 --> 0:52:27.880 Follow Chris Hughes on Twitter. He's at Chris Hughes. Follow 0:52:27.880 --> 0:52:31.120 our producers Kerman Rodriguez at Kerman armand dash Ol Bennett 0:52:31.120 --> 0:52:34.640 at Dashbot and Killbrooks at Kalebrooks. From our Odd Lags content, 0:52:34.680 --> 0:52:37.000 go to Bloomberg dot com slash odd Lots. We have 0:52:37.120 --> 0:52:39.759 all of our episodes and a daily newsletter. You can 0:52:39.840 --> 0:52:41.840 chat about all of these topics twenty four to seven 0:52:41.880 --> 0:52:45.719 in our discord Discord dot gg slash od lots. 0:52:45.760 --> 0:52:47.880 And if you enjoy odd Lots, if you like it 0:52:47.920 --> 0:52:50.200 when we do these live events, then please leave us 0:52:50.239 --> 0:52:53.840 a positive review on your favorite podcast platform. And remember, 0:52:53.920 --> 0:52:56.480 if you are a Bloomberg subscriber, you can listen to 0:52:56.719 --> 0:52:59.799 all of our episodes absolutely add free. All you need 0:52:59.800 --> 0:53:02.839 toys find the Bloomberg channel on Apple Podcasts and follow 0:53:02.920 --> 0:53:05.240 the instructions there. Thanks for listening.